ByEduardo Cue Special to The Christian Science MonitorJuly 16, 2001

But the annual parade on the Champs Elysees had already been upstaged. The real fireworks came in a live TV interview President Jacques Chirac gave afterward - the first time the embattled leader has spoken publicly on a scandal involving cash payments for luxury vacations taken in the early 1990's, while Mr. Chirac was mayor of Paris.

"I have nothing to hide," a combative Chirac told three television interviewers. "I paid for the trips with my personal money."

Defending the purchases as "perfectly legal," he said he would refuse to testify if called, and warned that a mounting judicial investigation threatens France's constitutional separation of powers as well the country's international image.

Like the Watergate and Lewinsky scandals in the US, the case is testing presidential immunity in France. The latest in a series of scandals here, it is also fueling demands for more accountability - and the end to a decades-old practice of cash handouts for top officials. And it may threaten Chirac's chances for reelection next year.

In the hourlong interview, Chirac denied using secret government funds or illicit contributions to pay for some 20 private trips between 1992 and 1995 for himself, his family, and close associates. He said cash was used for reasons of "discretion and security."

Last fall, Chirac faced allegations that, while he was mayor of Paris, his office received millions of dollars in kickbacks from construction companies for lucrative public-works contracts. The money supposedly was channeled to major political parties, including Chirac's Rally for the Republic.

"When one talks about 50 or 60 million francs ($7 million or $8 million) that wind up in the pockets of a political party, it doesn't mean much to the average person, it's just political life," says Dominique Paille, a conservative lawmaker. "This is different. Every Frenchman knows the cost of a weekend, a plane ticket, or a night in a hotel."

While Chirac on Saturday rejected the amount cited in the press - $312,000 - he declined to name his own tally on the cost of the trips in question.

As he has done in the past, Chirac categorically rejected calls that he testify before a panel of investigating judges. "The president of the Republic is not a citizen like any other," he said. "He has a mandate to ensure respect of the Constitution and protect the country's independence."

Last week, a Paris prosecutor declared that a judicial panel could interview the president as an "assisted witness" - a legal category in France that allows a prosecutor to question a person without the threat of putting the witness under investigation. But the Paris Court of Appeals disagreed.

Chirac's daughter Claude, a close advisor, has already testified in the case and his wife may be called in as well.

The scandal also has brought to the surface a surprising tradition that dates back to 1946. Each year, Parliament approves substantial sums ($52.5 million for the current year) that are left to the discretion of the prime minister. Some 60 percent goes to finance the French secret services, while the rest is distributed among various ministers and their assistants.

On Saturday, Chirac called for changing the system, keeping only the secret service funds. "What was considered normal 10, 20, or 30 years ago is today rightly seen as abnormal," he said.

Socialist Prime Minister Lionel Jospin - Chirac's likely opponent in the presidential election due in March - has has called his demands to freeze the funds "irresponsible." However, Mr. Jospin has appointed a commission to study the issue.

The president is not alone in facing financial scandals. In May, Roland Dumas, a former Socialist foreign minister, was sentenced to a 30-month jail term for his role in a massive corruption scandal involving the former nationalized Elf-Aquitaine oil company, now part of Total-Fina. Another former minister, Charles Pasqua, is under investigation on charges of bribery and the illegal sale of arms to Angola.